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IMAD upgrades its macroeconomic forecasting tools under the Technical Support Instrument funded by the European Commission
The Institute of Macroeconomic Analysis and Development of the Republic of Slovenia (IMAD) has upgraded its macroeconomic forecasting tools under the Technical Support Instrument (TSI) of the European Commission’s Reform and Investment Task Force (SG REFORM). The project was delivered by the ASCENT+ consortium, bringing together experts from BDO Slovenia, Cambridge Econometrics, Professor George Kapetanios and Dr. Fotis Papailias, in close collaboration with IMAD experts. The primary objective of the project was to provide IMAD with technical support for the development of new supporting tools for macroeconomic forecasting. These tools also support IMAD as an EU Independent Fiscal Institution in its role as the producer of macroeconomic forecasts in line with the guidelines of the renewed EU economic governance framework.
The two main objectives of the project Upgrading the Modelling Toolbox to Support Macroeconomic Forecasting in Slovenia were as follows:
1. To upgrade and complement IMAD’s existing short-term forecasting (nowcasting) tools in line with modern practices, which favour deploying a range of approaches and combining them as needed, depending on economic conditions.
2. To develop a modern macroeconometric model to support and enhance IMAD’s forecasting processes, thereby enabling faster and more efficient preparation of macroeconomic forecasts, while maintaining the expert judgement approach that has proven highly effective. In addition, the new model was envisaged to enable the preparation of alternative macroeconomic scenarios and sensitivity analyses.
The key results of the project – implemented from September 2024 to December 2025 with the support of IMAD experts involved in the design and development of the tools – are as follows:
1. A new nowcasting toolbox, which complements IMAD’s existing approach and offers a range of different methods, along with substantial flexibility in parameterisation and other user settings, with the ability to carry out forecast combination, prepare short-term projections, and consider uncertainty and the possibility of (mild) structural change. Such an approach has been shown in the literature to improve the robustness of short-term forecasts.
2. The new macroeconometric model follows the development of similar models in peer institutions that produce macroeconomic forecasts, while maintaining the important role of expert judgment.
Advanced analytical tools for short-term projections, long-term forecasting and sensitivity/scenario analysis will further contribute to the efficient forecasting of economic developments, also providing a basis for further development and improvements.
Upon successful completion of the project, we extend our sincere appreciation to Chris Thoung, Clara Tanios, George Kapetanios, Fotis Papailias, Andrej Baričič, Lazaros Dimitriadis, the Ministry of Finance, the Statistical Office of the Republic of Slovenia, and Jerneja Jug Jerše, Head of the European Commission Representation in Slovenia. We also gratefully acknowledge the contributions of our colleagues at the Institute, Andrej Kuštrin, Janez Kušar, Maja Založnik and Maja Bednaš.
Further information on the project and both models is available in the document Upgrading the Modelling Toolbox to Support Macroeconomic Forecasting in Slovenia.
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The presentation at the conclusion of the project Upgrade of Modeling Tools for Supporting Macroeconomic Forecasts in Slovenia,
Ljubljana, November 25, 2025
Photography source: Andrej Baričič